Gap Inc. (San Francisco) reported its second-quarter earnings, which included a drop in profits for the second quarter in a row.
Net income fell by more than 30 percent to $219 million. Company-wide comparable sales and revenue both fell 2 percent.
According to Reuters, the decline was affected by a strong dollar (which hurt profits by 5 percent), shipment delays and weak sales with the Gap brand. The company does not expect Gap sales to improve before the holiday shopping season.
Old Navy, however, saw comparable sales increase by 3 percent. The brand has been able to cut back on discounts and improve margins by operating on shorter lead times and keeping a tight control on inventory.
The company said that, due to these results, it will be closing underperforming stores and trying to get new merchandise into stores faster.